A banker's lien is a legal right arise in many common law jurisdictions of a

bank A bank is a financial institution that accepts Deposit account, deposits from the public and creates a demand deposit while simultaneously making loans. Lending activities can be directly performed by the bank or indirectly through capital m ...

to exercise a

lien A lien ( or ) is a form of security interest granted over an item of property to secure the payment of a debt or performance of some other obligation. The owner of the property, who grants the lien, is referred to as the ''lienee'' and the per ...

over any property in the custody of the bank as security. Lien is of two types: # Particular lien # General lien Particular lien confers to retain the goods in connection with which a particular debt arose i.e. A particular lien applies to one transaction or certain transaction only. e.g. a tailor has the right to certain the clothes made by him for his customer until his tailoring charges are paid by customer.

Scope

The precise effect of a banker's lien varies according to the laws of a particular jurisdiction. Under English common law it applies to all property coming into the possession of the bank in the usual course of banking business, subject to the important exception that it does not apply to property which is deposited with the bank for safe custody. Whilst most common law liens normally only give the lienee a passive right to retain the property, unusually, the banker's lien permits the bank to sell the relevant property. The lien does not generally extend to intangible rights, including credit balances on accounts. However those credit balances may be subject to the

banker's right to combine accounts Under English law, a bank has a general right to combine accounts where a customer has multiple accounts with the same bank. The right has been recognised since at least 1860. However it was not until 1975 in the House of Lords decision in '' ...

.''

National Westminster Bank Ltd v Halesowen Presswork & Assemblies Ltd ''National Westminster Bank Ltd v Halesowen Presswork & Assemblies Ltd'' 972AC 785 is a decision of the House of Lords in relation to a banker's right to combine accounts under English law. It is the leading English case and a banker's right ...

'' 972AC 785 The banker's lien may be modified or abrogated by agreement.

References

Property law Legal terminology Business law Banking Liens {{bank-stub